German car giants oppose the EU\’s tax hike on Chinese cars, which may be counterproductive

According to media reports including Reuters, BMW and Volkswagen executives warned against imposing EU import tariffs on electric vehicles from Chinese manufacturers. They argue that such measures could disrupt the EU\’s Green Deal agenda and negatively impact carmakers that rely on imports from China.

According to Reuters and other media reports, BMW and Volkswagen executives warned against imposing EU import tariffs on electric vehicles from Chinese manufacturers.
They believe such measures could disrupt the EU\’s Green Deal agenda and negatively impact carmakers that rely on imports from China.
The European Commission, which is responsible for trade policy in the 27-member bloc, launched an investigation in October last year to assess whether battery electric vehicles produced in China benefited from unfair subsidies and could be subject to additional tariffs.
After BMW released its financial results, CEO Oliver Zipse warned that imposing tariffs could be \”shooting ourselves in the foot.\”
BMW is bringing the Mini EV and iX3 from China to Europe, joining the likes of Volkswagen and Mercedes-Benz in leveraging their China operations.
China is BMW\’s second-largest market after Europe, with nearly a third of first-quarter sales coming from China.
In Zipse\’s view, operating globally gives major automakers an industry advantage that could easily be jeopardized by the imposition of import tariffs.
\”We don\’t think our industry needs protection.
This advantage could easily be jeopardized by the introduction of import tariffs.
” On the contrary, the implementation of the EU Carbon Border Adjustment Mechanism (CBAM) has led to a significant decline in China’s aluminum exports to EU countries, with volumes reportedly falling by as much as 30%.
Aluminum is a material favored by global electric vehicle (EV) manufacturers.
China is the world\’s largest aluminum producer, accounting for about 60% of global production.
Volkswagen, Europe\’s largest automaker, which relies heavily on the Chinese market, has warned that potential tariffs pose a level of risk.
Volkswagen CEO Thomas Schaefer said this could lead to some kind of retaliation.
The European Commission in March launched a customs register of imported Chinese electric cars that could impose tariffs on them pending the outcome of a trade investigation into unfair subsidies.
The investigation is expected to end in November and the EU could impose temporary tariffs as soon as July.
Brussels is expected to publish a summary of the proposed interim tariffs on June 5 and implement them on July 4.

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